CSR and our business
We operate our business within a framework of increasingly stringent and challenging legislative and regulatory requirements. We are, however, mindful of the still tougher expectations held by our wider stakeholder group. For us, corporate and social responsibility is about achieving a balance between the commercial and regulatory rigours of the competitive sector within which we operate and our commitment to our stakeholders.
The Board has ultimate control of policies in respect of both the wider corporate and social responsibility and in relation to environmental and health and safety matters. The Board’s policies are implemented by dedicated specialists who make sure effective processes and procedures are in place to assure compliance and to identify and to report on risks and opportunities.
As a responsible business, we continue to invest, not only to comply with the environmental and health and safety requirements, but, where practicable, to go further. Throughout 2007, we maintained our presence in the FTSE4Good Index Series, which is designed to measure the performance of companies that meet globally recognised corporate responsibility standards and facilitate investment in those companies.
Engaging with our stakeholders
Like many businesses, our stakeholders are diverse and include: our shareholders; employees; customers; suppliers; the local community; Government; non-governmental organisations; opinion formers; and the media. Communication with all our stakeholders is considered to be an essential part of our business and we aim to be open and transparent in all that we do. We fulfil our communication commitments through an investor relations programme and a wide-ranging external relations programme.Investor relations
Drax is committed to delivering shareholder value. We communicate our results and prospects to our shareholders in an accurate and timely manner using a variety of channels. In addition to the Annual General Meeting, we communicate through our Annual Report and Accounts, Half Year Report and Trading Updates. From 2008, we will also have the obligation to provide Interim Management Statements. All of these documents are made available on our website at www.draxgroup.plc.uk. Significant matters relating to trading and the development of the business are disseminated to the market by way of announcements via a regulatory information service and those announcements appear as soon as practicable on our website.Face-to-face meetings are held with our major institutional shareholders to assist them in understanding the information announced to the market and to ensure that the Board is aware of investors’ views and concerns. In 2007, a formal meeting programme was delivered in the UK, US and Europe after each of the Preliminary and Interim Results announcements. To aid our communication with our private investors, during 2007 we developed further the investor section of our website improving the information that is readily available.
External relations
Following on from our public affairs focus in 2006, we maintained our engagement with the Government on issues arising from the Energy Review, including the regulations governing co-firing of renewable materials. On 1 April 2007, we were pleased to see an amendment to the renewables regime come into effect which removed the caps and constraints in relation to energy crop co-firing. Importantly this removed the regulatory barrier to accessing value from Renewable Obligations Certificates (“ROCs”) when co-firing energy crops.Further positive news on the future for co-firing came with the publication of the Energy White Paper in May 2007, which proposed a fundamental reform of the Renewables Obligation (“RO”). The proposal to band the RO will place the various renewables technologies into bands according to their state of development, and reward each band with differing fractions or multiples of ROCs. The proposal is consistent with the representations we made during the Energy Review and we believe that it has the potential to deliver a mechanism that is fair to all forms of renewables and enable co-firing to make a meaningful contribution to targets for reducing carbon dioxide (“CO2”) emissions. Throughout 2007, we continued to work with the Government on the detail of the proposals to ensure appropriate bands and rewards.
Locally, we have continued to engage with parish, town, district and county councillors and officers, with the intention of keeping them up to date with our business issues and developments. Our regular communication channel with these and other local opinion formers takes the form of an annual consultative meeting, and three meetings each year with our local parish and town councillors. This year, in addition to these formal meetings, we held meetings with councillors, opinion formers and the local press, and public drop-in sessions to disseminate information concerning our plans for developing our co-firing facility at the Drax site and the results, specifically from environmental monitoring, of our coal/petcoke trial.
No political donations were made in the UK or elsewhere during 2007, and the Company’s contact with those active in the political arena has been and will continue to be aimed solely at the promotion of the Company’s business interests.